20-0914 Monday “Daily Bugle”

20-0914 Monday “Daily Bugle”

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Monday, 14 September 2020

(No items of interest posted) 

  1. Items Scheduled for Future Federal Register Edition
  2. Commerce/BIS: (No new postings)
  3. State/DDTC: (No new postings)
  1. Reuters: “ByteDance Drops TikTok’s U.S. Sale, to Partner with Oracle: Sources”
  1. Steptoe: “China Updates its Catalogue of Technologies Prohibited and Restricted from Export”
  1. Monday List of Ex/Im Job Openings: 54 Available – 10 New Job Openings This Week
  1. ECTI Presents: 16 Sep; “Trade Compliance on a Budget – Interactive Process for Building YOUR “Right-Size” Compliance Program Webinar”
  2. FCC Academy Presents 4 Webinars: U.S. Export Controls: ITAR & EAR | FMS | Designing and Implementing an ICP
  1. Bartlett’s Unfamiliar Quotations 
  2. Are Your Copies of Regulations Up to Date? Find the Latest Amendments Here. 
  3. Weekly Highlights of the Daily Bugle Top Stories 
  4. Submit Your Job Opening and View All Job Openings 
  5. Submit Your Event and View All Approaching Events 

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Bartlett’s Annotated ITAR and Bartlett’s Annotated FTR are Word documents to down-

load to your laptop to keep you updated on the latest amendments, and contain over 800 footnotes of section history, key cases, practice tips & tricks, and extensive Tables of Contents. The ITAR amendments to the ITAR that took effect on 9 March and 25 March are included in the current edition of the BITAR.  Subscribers receive updated editions every time the regulations are amended (usually within 24 hours) so you will always have the current versions of the regulations. Subscribe to the BITAR now to guarantee you have an up-to-date ITAR!    

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(Source: Federal Register)  
* Treasury/OFAC; NOTICES; Blocking or Unblocking of Persons and Properties; [Pub. Date: 15 Sep 2020]
* State/DDTC; NOTICES; Certification Related to Foreign Military Financing under the Department of State, Foreign Operations, and Related Programs Appropriations Act, 2020:Egypt; [Pub. Date: 15 Sep 2020]

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NWS_a14China Briefing: “Why is China Introducing New Technology Export Controls?”

On August 28, 2020, the Ministry of Commerce of the People’s Republic of China (MOFCOM) and the Ministry of Science and Technology jointly issued the Announcement No. 38 (2020) (“Announcement”) amending the Catalogue of Technologies Prohibited or Restricted from Export (“Catalogue”).
In total, 53 items have been deleted, added, or revised – with new restrictions imposed on the export of 23 cutting edge technologies, which are either based on China’s indigenous intellectual property or are data-based personalized products that have become sensitive due to geopolitical assessment or foreign government scrutiny.

Regulation of China’s technology exports

To standardize the administration of technology exports, promote scientific and technological progress, facilitate foreign economic and technological cooperation, and maintain the economic security of the state – China has put in place a policy of catalogue management on technology exports since 1998.
By technology exports, China’s government refers to the transfer of technology from the People’s Republic of China to overseas through trade, investment, or economic and technical cooperation. The specific format of such transfers could include patent assignment, transfer of patent application rights, patent licensing, transfer of technology secrets, technical services, and other forms of technology transfer. . . .
Accordingly, all technology exports, whether through trade or investment or other way, should strictly abide by the Regulation. Hence, technologies listed under the Catalogue as prohibited (those that include materials containing state secrets, cultural relics and antiques, and endangered species) shall not be exported.
On the other hand, technologies listed in the restricted category will be subject to licensing administration – an approval must be obtained from relevant commerce departments in charge at the provincial level prior to making substantive negotiation with the foreign party and signing any contracts for the technology export.

What are the amendments to the ‘Catalogue of Technologies Prohibited or Restricted from Export’?

  • Removed four technical items that are prohibited from export, including microbial fertilizer technology, caffeine production technology, riboflavin production technology, and vitamin fermentation technology.
  • Removed five technical items that are restricted from export, including Newcastle disease vaccine technology, natural medicine production technology, functional polymer material preparation and processing technology, chemical synthesis and semi-synthetic medicine production technology, and information security firewall software technology.
  • Added 23 new technical items whose exports will be restricted, including artificial breeding technology of agricultural wild plants, cashmere goat breeding and breeding technology, space material production technology, large-scale high-speed wind tunnel design and construction technology, aerospace bearing technology, and laser technology, among others.
  • The last amendment modifies the control points and technical parameters of 21 technical items involving crop breeding technology, aquatic germplasm breeding technology, chemical raw material production technology, biological pesticide production technology, spacecraft measurement and control technology, space data transmission technology, map mapping technology, information processing technology, vacuum technology, among other fields. . . .

The licensing procedure

The licensing procedure is articulated mainly into two phases that can be summarized as follows:

Phase 1

  • Filing: The applicant shall file the application before the competent foreign trade department under the State Council.
  • Examination: The competent foreign trade department in conjunction with the science and technology administrative department under the State Council shall examine the application and, within 30 working days from the date of receipt of the application shall approve or disapprove it.
  • Issuance of a letter of intent: In case of approval, the competent foreign trade department under the State Council shall issue a letter of intent for licensing the technology export.
  • Negotiation and signature of the contract: After obtaining the letter of intent for licensing the technology export, the applicant may begin substantive negotiation and conclude a contract for the technology export.

Phase 2

  • Application for the license for technology export: The applicant shall submit to the competent foreign trade department under the State Council the letter of intent previously obtained, a copy of the technology export contract, a list of technical information relating to the export, and any regulatory document certifying the legal status of the two parties to the contract.
  • Examination: The competent foreign trade department under the State Council examines the authenticity of the technology export contract and decides, within 15 working days from the date of receipt of the documents provided, on approval or disapproval of the technology export.
  • License issuance: In case of approval, the competent foreign trade department under the State Council issues the technology export license.
Based on the current legal framework foreign companies should be prudent in dealing with Chinese companies engaging in activities related to restricted technologies –  not only when it comes to purchasing tech products, but also, for example, when they buy technologies that might be rendered (almost) useless, if not supported by the transfer of a specific know-how, patent rights, or technical services.
The bottom line here is that foreign companies should carefully evaluate any operation that involves restricted technologies in China and be aware of the risk that the Chinese government could decide to prevent them from being exported. . . .


(Source: Steptoe, 11 Sep 2020)
* Principal Author: Richard J. Battaglia, Esq., 86-10-5834-1041, Steptoe
On August 28, China’s Ministry of Commerce and Ministry of Science and Technology jointly released a newly revised Catalogue of Technologies Prohibited and Restricted from Export (“Catalogue”), which is the second revision since the creation of the Catalogue in 2001. While China has separate control lists for items (including technology) controlled for non-proliferation reasons (i.e. nuclear, biological, chemical and missile-related control lists), this Catalogue sets forth technologies that otherwise warrant control, including on grounds of national security, public interests, environmental protection, etc.[FN/1] 


The Catalogue is structured in accordance with the industry classification issued by China’s National Bureau of Statistics, with the controlled technologies listed by category under each industry with a code assigned to the category. Before the revision, the Catalogue contained 150 categories/codes of technologies related to 34 industries, including 33 prohibited categories and 117 restricted categories. The controlled technologies include techniques related to China’s indigenous cultural and natural resources (e.g. manufacturing techniques of certain tea, alcohol, food and Chinese medicine, certain panda nurturing techniques) as well as technologies that are important to safeguarding China’s economic interests and national security.
The revision this time removed 4 categories of “prohibited” technologies and 5 categories of “restricted” technologies, while adding 23 new categories of “restricted” technologies. Moreover, changes were made to 21 existing categories with respect to the nature and parameters of the specific technology covered. Those newly added include technologies related to encryption, cyber defense, metal 3D printing, aero remote sensors, UAVs, lasers, major power and petrochemical facilities, etc.
With respect to artificial intelligence, five technologies were added to the negative list including speech synthesis, voice recognition, smart review of exam answers, artificial intelligence user interface and data analysis-based personalized recommendation pushes. This move has generated media headlines as some have surmised that the addition, especially the data-based categories, may potentially impact the timing of any sale by ByteDance Ltd. (“ByteDance”) of its Tiktok app.  The U.S. government has ordered ByteDance to divest its U.S. Tiktok operations as a result of a review of ByteDance’s acquisition of musical.ly by the Committee on Foreign Investment in the United States.  ByteDance has been in discussions with a number of U.S. companies about a potential sale of Tiktok.
As a result of the changes to the Catalogue, a sale of Tiktok reportedly would trigger review by the Chinese government. Perhaps tellingly, the state-run Xinhua News Agency released a media report in which a university professor called on Bytedance to “seriously study the revised catalog, seriously and carefully consider whether there is need to suspend the substantive negotiation of related transactions, fulfill the required petition procedures, and then take further actions according to the situation.” According to other media reports, ByteDance has been informed through preliminary talks with Chinese government officials that any proposed transaction must be submitted for approval.
As the name implies, technologies in the “prohibited” section of the Catalogue are banned from export. For technologies in the “restricted” section of the Catalogue, government approval (currently at the provincial level) is required before parties can engage in substantive negotiations regarding export and sign contracts, and an export license needs to be obtained before the export can be made. Notably, the word “export” here is defined in the applicable regulation[FN/2] as “the transfer of technology from China’s territory to abroad through trade, investment or economic and technological cooperation” and the latter part has been interpreted by the Ministry of Commerce to encompass all means of transfer. While the definition appears territorial based, it remains to be seen whether the Catalogue will be triggered in the case of “deemed exports.” (As noted in our earlier article, China’s upcoming new export control law, as it is currently drafted, has not expressly subjected deemed exports to control.)  Another noteworthy point is that some of the criteria descriptions in the newly added items, as well as the previously existing items in the Catalogue, are quite generic, for example, several descriptions contain the term “key technologies” although that term remains undefined. Arguably, this caveat may potentially provide the Chinese government certain level of discretion in the implementation of the new rules.
In an official statement released concurrently with the revised Catalogue, the Ministry of Commerce stated that the main purpose of the revision was to “regulate the export of technologies, promote technological improvement and expand economic and technological exchanges with foreign countries while safeguarding national economic security.” It also stressed that China would enhance cooperation with other countries on technology trade and will further “shorten and revise” the Catalogue.
The revision of the Catalogue of Technologies Prohibited and Restricted from Export, as well as China’s legislative activities regarding an export control law, reflects Chinese government’s efforts to enhance its export control regime and an increased attention to export control as a policy tool. We will continue to monitor developments in this area in China.
[FN/1] Art. 29, Regulation of the People’s Republic of China on the Administration of Import and Export of Technologies, State Council, Mar. 2, 2019.
[FN/2] Id. Art. 2.


MS_a16. Monday List of Ex/Im Job Openings: 55 Jobs Available –  11 New Job Openings This Week 

New Jobs
* FUJIFILM; Bothell, WA; Manager, Global Import/Export Compliance; Job ID: 2020-13549
* Full Circle Compliance (FCC); Netherlands (Remote); EU/US Trade Compliance Analyst; Contact Details: Marco Crombach, COO   
* HD Supply; Atlanta, GA; Senior Import/Export Analyst – Trade Compliance; Job ID: 2020-39418
* Knorr Brake Company; Westminster, MA; Logistics & Trade Compliance Administrator; Job ID: 15671; Contact Details: Matthew.Tipton@bendix.com
* Microsoft; Atlanta, GA; Export Control Manager; Job ID: 8957
*  Oak Ridge National Laboratory; Oak Ridge, TN; Export Control Analyst
* Sable Systems International; North Las Vegas, NV; Import Export Manager;
* Supermicro; San Jose, CA; Compliance Manager; Job ID: 10356
* Twist Bioscience; South San Francisco, CA; Sr Global Trade Compliance Specialist
* University of California; Riverside, CA; Export Control Officer
* WizeHire; North Las Vegas, NV; Import Export Manager

Click here for the full list 

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(Source: Ashleigh Foor, ashleigh@learnexportcompliance.com)
* What: Trade Compliance on a Budget: Interactive Process for Building YOUR “Right-Size” Compliance Program
* When: 16 Sep; 1:00 p.m. (EDT)
* Where: Webinar
* Sponsor: Export Compliance Training Institute (ECTI)
* ECTI Speaker: Rosanne Giambalvo and Alan Levesque
* Register: bit.ly/ECTITradeBudget / or Ashleigh Foor, 1-540-433-3977, ashleigh@learnexportcompliance.com.
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The ABC of Foreign

The ABC of Foreign Military Sales (FMS)
Tuesday, 29 September 2020
Designing and Implementing an ICP
Tuesday, 6 October 2020 More Info
Wednesday, 7 October
More Info
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EN_a19. Bartlett’s Unfamiliar Quotations

(Source: Editor)

* Marie von Ebner-Eschenbach (Countess Marie von Ebner-Eschenbach; 13 Sep 1830 – 12 Mar 1916; was an Austrian writer. Noted for her excellent psychological novels, she is regarded as one of the most important German-language writers of the 19th century.)
  – “Imaginary evils are incurable.”
* Hamlin Garland (Hannibal Hamlin Garland; 14 Sep 1860 – 4 Mar 1940; was an American novelist, poet, essayist, short story writer, Georgist, and psychical researcher. He is best known for his fiction involving hard-working Midwestern farmers.)
  – “Whenever the pressure of our complex city life thins my blood and numbs my brain, I seek relief in the trail; and when I hear the coyote wailing to the yellow dawn, my cares fall from me – I am happy.”
Monday is pun day
* What do you call a boomerang that won’t come back?  A stick.
* What time is it when the clock strikes 13?  Time to fix your clock.
* How does a cucumber become a pickle? It goes through a jarring experience.
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The official versions of the following regulations are published annually in the U.S. Code of Federal Regulations (C.F.R.), but are updated as amended in the Federal Register.  The latest amendments are listed below.
Latest Update 


5 Apr 2019: 84 FR 13499:

Civil Monetary Penalty Adjustments for Inflation. 
31 Jul 2020: 85 FR 45998: Revision of the Export Administration Regulations and Suspension of License Exceptions for Hong Kong. 
DOC FOREIGN TRADE REGULATIONS (FTR): 15 CFR Part 30.   24 Apr 2018: 83 FR 17749: Foreign Trade Regulations (FTR): Clarification on the Collection and Confidentiality of Kimberley Process Certificates.  

: DoD 5220.22-M. Implemented by Dep’t of Defense. 

18 May 2016: Change 2: Implement an insider threat program; reporting requirements for Cleared Defense Contractors; alignment with Federal standards for classified information systems; incorporated and cancelled Supp. 1 to the NISPOM (Summary here.)  
DOE ASSISTANCE TO FOREIGN ATOMIC ENERGY ACTIVITIES: 10 CFR Part 810.    23 Feb 2015: 80 FR 9359: comprehensive updating of regulations, updates the activities and technologies subject to specific authorization and DOE reporting requirements. 

15 Nov 2017, 82 FR 52823: miscellaneous corrections include correcting references, an address and a misspelling.

DOJ ATF ARMS IMPORT REGULATIONS: 27 CFR Part 447-Importation of Arms, Ammunition, and Implements of War. 
14 Mar 2019: 84 FR 9239: Bump-Stock-Type Devices.


29 Jul 2020: 85 FR 45513 Extension to Certain Temporary Suspensions, Modifications, and Exceptions due to Corona Virus.  The latest edition of the BITAR is 29 July 2020.  

DOT FOREIGN ASSETS CONTROL REGULATIONS (OFAC FACR): 31 CFR, Parts 500-599, Embargoes, Sanctions, Executive Orders

17 Jul 2020: 85 FR 43436: Nicaragua Sanctions Regulations. 


1 Jan 2019: 19 USC 1202 Annex.
  – HTS codes for AES are available here.
  – HTS codes that are not valid for AES are available here.

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